June 2, 2023 — Inflation is weighing on Americans across income levels. Customers are clearly feeling cautious and making trade off decisions. Private label sales are soaring as consumers trade down on goods. Consumers are still spending money however. Airlines and cruise ships are booked at capacity. But they are still concerned about inflation and cutting back on expensive food items.
According to a Bloomberg survey of economists the odds of a U.S. recession in 2023 are as high as 65%. Consumers still have some stimulus savings and unemployment is low allowing for continued income. Inflation, higher interest rates, the service industry, and lower consumer confidence impact what they are willing to pay for food.
The research firm Circana reported that U.S. consumers are managing their food spending by finding lower cost products than high priced proteins.
The latest example came from Costco whose customers tend to be upper middle class. Costco did not meet Wall Street analysts expectation of growth in the quarter ending May 7. Although the traffic at the stores grew 4.8% customers are walking out with smaller receipts as transactions declined -4.2%. Costco’s CFO stated that sales have shifted from beef to chicken and pork as consumers select lower priced protein. Costco as well as Walmart are actively working with suppliers to lower costs and bring price relief to consumers. Source: Wall Street Journal
Two major events are ongoing and effecting the global crab world. The first event, now embarking on its second year, is the ban of Russian crab in the U.S. and western countries. The second event is that all of Canada snow crab fishery is fully underway now that the Newfoundland/Labrador harvesters and processors have come to an agreement.
Even though there is still Russian king and snow crab in the market (because of its import prior to the ban date of June 23, 2022), some distributors have asked how long it will take to sell the remaining Russian King crab. No one knows for sure although there are some gaps appearing in inventory. However, consumers are not purchasing Russian crab products at the pace previously seen during the pandemic.